Consumers preferences exhibit diminishing marginal utility

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Reference no: EM13868602

For the two good utility function: U = x^2y^2

a) Is the assumption that more is better satisfied for both goods?

b) Does this consumer’s preferences exhibit diminishing marginal utility of X?

c) Does this consumer’s preferences exhibit diminishing marginal utility of Y?

d) What is the MRSx,y?

e) Is the MRSx,y diminishing with respect to x? Use math to verify your answer.

Reference no: EM13868602

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